Comparison sites must end partial listings of energy suppliers that pay commission

21st January 2015

Comparison websites must make it easier for customers to see the full range of energy tariffs on the market and clearly disclose which suppliers pay them commission, the watchdog has said.

Under Ofgem’s revised Confidence Code, comparison websites will no longer be allowed to show default results tables that only include the suppliers which pay commission – a practice that has been widely criticised by consumer groups.

The watchdog said that its Confidence Code gives customers assurance that accredited sites are independent of suppliers, carry every tariff available in the market and meet higher standards of accuracy and reliability when showing tariff information.

Ofgem said that comparison sites are currently the most popular way to shop around for gas and electricity – around 40 per cent of energy shoppers used a comparison site to compare suppliers at their last switch.

It took on the Code from Consumer Focus in 2013 and has been examining whether it provides the right protections for energy customers.

Today’s changes are:

Banning a default partial view. Sites must show all tariffs available in the market unless customers actively choose to select to see a smaller number of tariffs.

Ending confusing language. The wording of any choice must be very clear to site users. Sites must test their messaging with consumers and be able to prove that it is clear and simple. If a site cannot demonstrate this, it will not be able to give customers a choice of view, and will have to show all tariffs. The wording of this choice must be approved by Ofgem.

Making commission arrangements transparent. Sites must explain clearly that they earn commission on tariffs that customers can switch to directly through the site.

The new Code goes live at the end of March 2015. Sites that want to keep their accreditation and carry on displaying the Confidence Code logo must satisfy the new rules by that point, or Ofgem will withdraw its accreditation. Ofgem will keep the Code under review, to make sure it continues to provide a high level of consumer protection without preventing accredited sites from coming up with innovative ways of marketing energy deals to customers and keeping pace with changes in the energy market.

Rachel Fletcher, Ofgem senior partner, said: “Our market reforms have made it easier for consumers to pick out better deals and switch suppliers. There has never been a better time to switch – consumers can make savings of around £200 by switching. Comparison sites are a great place to start energy shopping, but customers need to feel confident that the sites are providing information they can trust. From the end of March, Confidence Code accredited sites will need to be more transparent with their users and I’d encourage them to meet these new standards earlier.”